There has been a significant amount of buzz lately about Facebook considering a new Revenue Model which will allow users to pay for an Ad-Free Experience and that my friends will put a big wrench into the “ultra-targeting” that marketers are currently doing as part of their online strategy. Many studies have been performed which say that Facebook will make even more money from its ads just by offering to get rid of them for a price. Let’s Discuss
Facebook Ads Not Looking To Good:
According to an article entitled “Could Facebook Make More by Dumping Ads?” by wallstcheatsheet.com, a recent study by Greenlight Digital shows that not only 70% of users almost never click on FB Ads, but users would be interested in paying a monthly fee to NOT show any ads. Here’s the snippet:
A recent study from Greenlight shows that Facebook could make even more money from its ads, by offering to get rid of them for a price. The group polled 500 people globally to see how willing they’d be to pay Facebook to not see ads. Fifteen percent responded that they’d be willing to pay a monthly fee to keep their Newsfeeds free of ads, with 8 percent saying they’d pay up to $10 per month for such a service.
“The Greenlight study also showed that 70 percent of users “rarely” or “never” click on ads on Facebook, leading Greenlight to suggest that the social media site “pace itself a little less aggressively” on allowing ads to fill up users’s Newsfeeds. Pouros noted that a similar problem killed search engine AltaVista, when Google (NASDAQ:GOOG) brought in a cleaner and more user-friendly search experience.”
In another related, yet very humorous article from Business2community.com, author Rachael Parker states that “What used to be a friendly place to catch up with friends, family and, yes, a few trusted brands has turned into a cacophonous Grand Central Station of advertising, my once-cozy News Feed now infested with pushy promos from companies I’ve never heard of. “
Future of Facebook Ads:
Ok, now that we are getting the sense that Facebook is turning itself into a typical Diner-Sized Paper-Mat or a Nascar Sponsorship and Users and Advertisers are starting to get very “turned off” by it. With that said, all of the Strategies of “slicing and dicing” GEO, Ages, Marital Status, Interests, Partner Categories, etc, are eventually going to be useless if FB decides to offer to allow users to pay to remove ads. Moreover, if this does happen, it will also affect any Google Display strategies which have been leveraging FB learnings.
We all know that Facebook Ads is not the best-converting platform for most advertisers. Marketers have had to dissect their audiences down to micro levels to try and make the strategies work. Now, with all of the negative commentary, research and studies, Facebook Ads is starting to become obsolete and it’s now up to Facebook Execs to please their shareholders as to the next step. Perhaps, Facebook Ads was expected to be just a “Phase” or an experiment that was destined to fail because of fatigue. Whatever FB does, they need to be careful not only how much they monetize, but which people they want to annoy (shareholders or their users).